ProjectsWork plan for IFRSIFRS 11 Joint Arrangements—Remeasurement of previously held interests – Obtaining control or joint control in a joint operation that does not constitute a business

IFRS 11 Joint Arrangements—Remeasurement of previously held interests – Obtaining control or joint control in a joint operation that does not constitute a business

Issues Rejected – Agenda Decision

IFRS 11 Joint Arrangements—Remeasurement of previously held interests – Obtaining control or joint control in a joint operation that does not constitute a business

The Interpretations Committee discussed some transactions involving previously held interests in order to determine whether or not previously held/ retained interests should be remeasured. This page provides further information on the transactions that the Interpretations Committee decided not to add to its agenda. See section ‘Related Projects’ below for a link to other transactions discussed by the Interpretations Committee as part of this project.

The Interpretations Committee discussed whether previously held interests in the assets and liabilities of a joint operation should be remeasured in the following transactions when the asset or group of assets involved in such transactions do not meet the definition of a business in accordance with IFRS 3 Business Combinations:

obtaining control of a joint operation, when the entity previously had joint control of, or was a party to, the joint operation before the transaction; and

a change of interests resulting in a party to a joint operation obtaining joint control over the joint operation. The party to the joint operation had rights to the assets and obligations for the liabilities relating to the joint operation before the transaction.

The Interpretations Committee noted that paragraph 2(b) of IFRS 3 explains the requirements for accounting for an asset acquisition in which the asset or group of assets do not meet the definition of a business. The Interpretations Committee noted that paragraph 2(b) of IFRS 3 specifies that a cost-based approach should be used in accounting for an asset acquisition, and that in a cost-based approach the existing assets are generally not remeasured. The Interpretations Committee also observed that it was not aware of significant diversity in practice and, therefore, decided not to add this issue to its agenda.